Dubai Port Capitulation Likely Fraudulent

Thursday, March 9. 2006

Dubai Port Capitulation Likely Fraudulent

Update (March 15): DPW Sale Announcement Update

Update (March 14): My initial assessment has just been confirmed:

DP World: No Plan to Sell Miami Port Ops

Update (March 13): Here is evidence of previous DPW misinformation that "The Dubai Government Has Nothing To Do With Us"

Update (March 10): While the MSM is unanimously running with the story that the deal is over, Dubai is sending out mixed messages, such as this story threatening "hitting back hard" if the port deal is blocked.

There is news that the Dubai Ports firm is giving up its attempt to take over US ports by turning over control completely to an American firm:

Dubai Company to Transfer U.S. Ports to American Company However, the stories admit that:

It was not immediately clear how the divesture would be handled or what U.S. company would take over the operation.

One article, however, quotes a statement that "we will continue to hold our U.S. operations separate while this process continues." In other words, the Dubai corporation will maintain a separate incorporation status for the American subsidiary. A few comments:

-This is a standard legal fiction for corporations who maintain complete operational control over their foreign subsidiaries. As an Information Technology consultant to many multi-national corporations, I can say with certainty that corporate management has access to the information systems of local subsidiaries.

-Note the key word "continue." This strongly implies that there is no change. In other words, there is no news here.

-While it is possible that the government-owned firm will indeed be forced to sell, it should be noted that all Arab governments routinely lie. Remember when the Palestinians renounced terrorism? Here is this week's biggest example.

In any case, this popular uprising is, as I predicted two weeks ago, a Harriet Miers reprise and a victory for an Army of Davids.

Update: UAE Ranks Highest in Support for bin Laden

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Posted by Barak at 21:30 | Comments (18) | Trackbacks (6)

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DPW Sale Announcement Update
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gringoman.com trackbacked 'Fraud" for 'Doing It In Dubai'

[Mar09 Update. BULLETIN at Michelle Malkin: Dubai Deal Dumped.NOTE: Iris demurs, suspects fraud] Could real life (or real night life) matter in a bipartisan uprising against White House globalistas? Persian Gulf fun and games and partying? Relevant? Relevant to Dubai Ports World coughing up 6.8 billion dollars to buy the U.K. P&0 company and move into U.S. ports? Relevant to, "In a post-9.11 world, do we really want this?" The Dubai fun, of course, comes with some real world complications, like significant human trafficking and White Slavery (although the bondage is hardly all 'white' today.)

#1 gringoman (Link) on 2006-03-09 23:35 (Reply)

I disagree with Barak. As the FT article this morning stated, getting rid of the US ports portion of the P&O deal makes eminent economic sense as they are the least profitable and money losing given stevedoring labor contracts, so if anything the DPW deal ROI is enhanced through the application of the proceeds of the divestment of the US assets.

The big loser in all this is Israel, because an opportunity to stick to the Arab Boycott -the UAE and Saudis and the 20 other members of the Arab League- is now lost.

As the White House office of Jewish Liaison said in an email forwarded to me last week, the violation of U.S. anti-Boycott compliance laws as a I stated on Alan Nathan's Battle Lines" program on Radio America yesterday was the "chink in the armor."

The overwhelming House Appropriations commitee 62 to 2 vote yesterday was coincident with the release of the State Department annual human rights report. Prominent among violaters was the UAE for such practices as flogging women for illicit sex and virtually enslaving Paki boys as camel race jockeys.

So the rumors flying around Capitol Hill about Dubai cllosing the port to our Fifth Fleet and Air Emirates shelving orders for Boeing 777s and buying Airbus super jumbo jets was so much blather.

Today's announcement was a win win for DPW CEO Bilkey and President Bush and his frazzled White House staff. The House and Senate can now focus on another toughie: immigration reform.

But as I said the leverage was lost to kibosh the Arab Boycott against Israel, notwithsytanding the ZIM lines 'nice words' of support for the DPW.

#2 Jerry Gordon (Link) on 2006-03-10 00:07 (Reply)

There was no violation of US anti boycott laws. The anti-boycott laws dont apply to primary boycotts.

Because the U.S. does not wish to infringe on the right of any country to choose its own trading partners, the anti-boycott laws do not target primary boycotts--limitations on the import and export of products from a specific country.

They are directed instead against secondary and tertiary boycotts. In a secondary boycott, a country demands, as a condition of doing business, that a U.S. person does not conduct any business with the boycotted country.

In a tertiary boycott, a country prohibits a U.S person from engaging in business with other entities that have business with the boycotted country.

#2.1 Glasgow on 2006-03-10 00:25 (Reply)

Thanks, Jerry, for your thoughtful comment.

The way I understand the rejection of this deal is that there is only great risk associated with it and little potential gain.

Among the unsavory facts that came out about Dubai was their boycott participation against Israel. Americans generally find this repugnant so it was a factor in their rejection.

I don't see how that could be a bad thing.

#2.2 Barak (Link) on 2006-03-10 03:05 (Reply)

I wouldn't look at this as being disingenuous, but as a good compromise. It's perfectly acceptable for an American subsidiary, run and staffed by Americans, to run the day-to-day business which may involve security concerns, while sending the profits alone to Dubai.

This whole episode has been overblown, and if their smart, the White House and Congressional Republicans will see this as their way out, and something of a victory for diplomacy. If we're smart, we'll do the same.

#3 Protagonist (Link) on 2006-03-10 01:01 (Reply)

The key question is whether the parent company will have access to the US subsidiary's information, such as their computer systems. If so:

"company officials would be briefed on security procedures and countermeasures that, if compromised, could allow foreign terrorists to get through various screening procedures."

As an Information Technology consultant to many multi-national corporations, I can say with certainty that management has access to the information systems of local subsidiaries.

#3.1 Barak on 2006-03-10 02:32 (Reply)

it should be noted that all Arab governments routinely lie

Arab governments DO NOT LIE - they do Taqqiya, a theologically different bird altogether.

#4 DP111 on 2006-03-10 01:44 (Reply)

You are absolutely right. That's why I linked to an article about taqiya from the phrase "routinely lie."

#4.1 Barak on 2006-03-10 01:56 (Reply)

Dubai is a very modern builder and not your average 7 th century Arab playing Jihad via a terrior manifesto. Take a look at its state of the art new port city, there is nothng like it in the world. They are doing business and trade with us and our fleet is parked in their frontyard with contract.

#5 SirSeth on 2006-03-10 01:46 (Reply)

The UAE does support terror groups such as Hamas and the al-Qaeda-linked Lashkar, as I have documented at the bottom of this post:

http://www.iris.org.il/blog/archives/1074-An-Army-of-Davids-May-be-Defeating-the-Suicidal-Arab-Port-Sale.html

#5.1 Barak (Link) on 2006-03-10 05:04 (Reply)

This isn't a "victory for the army of Davids", it is a victory for stupidity and ignorance. What a sad, sad capitulation to the fearmongers.

But hey, France thanks you. So does Russia. We just lost one of our best customers for high-tech weapons and airliners. That big Boeing 787 order? That will be cancelled and given to the French Airbus company. All those weapons we sell them? No more. They'll be buying from the Russians and Europeans now. Funny how we trust them with the latest high-tech weapons, with not a bit of controversy from the likes of Schumer, but we can't trust them in a business deal where we control all security aspects. Oh, and one other thing. Those billions in US treasuries the Gulf States buy every month? Guess what they'll be buying now since we just peed on them.

I've learned a lot about who the real idiots are in the blogosphere. I always knew Kos and Atrios were idiots, but I never pegged Michelle Malkin or Roger L. Simon as idiots. Now I know better.

So congrats on your big "victory". Enjoy the consequences of your stupidity. Too bad you never stopped to consider the consequences.

#6 Lou Minatti (Link) on 2006-03-10 04:40 (Reply)

It's funny how the Bushites want it both ways. FEAR FEAR FEAR THE ARABS! But lets do business with them.

Chris McElroy
http://www.ThingsThatJustPissMeOff.com

#6.1 Chris McElroy (Link) on 2006-03-10 16:42 (Reply)

And you don't see how the anti-Bushies have split it, too? We must embrace the Muslim world and win their hearts and minds....but we will never trust them to do anything but buy our best horses. The flipfloppery on both sides has been amusing to me, but I think the potential gains lost, vis a vis future Iran and Syria engagementes, are more important than a mythical breach in port security.

#6.1.1 rastajenk on 2006-03-10 18:37 (Reply)

You make a valid point on winning their hearts and minds. However, as long as our government continues to put corporation's interests above those of the people in those countries, we will never do so.

And our government, whether republicrook or democrook will never stop doing whatever it takes for those corporations to make money, regardless of the consequences.

Chris McElroy
http://www.newsandmediablog.com

#6.1.1.1 Chris McElroy (Link) on 2006-03-10 18:46 (Reply)

Thank you for your comment. Unfortunately you and I see our enemy differently. I admit my view is highly contrarian.

I don't agree that we need to win the hearts and minds of Muslims. Committed Muslims nearly exclusively believe in the importance of continuing their Global Jihad to dominate the world. Non-Muslim "niceness" is irrelevant.

The reason the Global Jihad subsided around the fall of the Ottoman Empire had nothing to do with Europeans winning friends and influencing people. It had to do with Muslims' utter military inferiority. Muslims believe in Mohammed's injunction to conquer during a time of strength and to build power during a time of weakness.

The extremists are trying to make a pragmatic case to the mainstream Muslim world--even though the West is technically superior, it is really a "paper tiger" (bin Laden's words), unwilling to use military force when Muslim "taqiya" (deception) techniques are used effectively. They hypothesized that the West would respond to terror with conflict resolution strategies. By framing their aggression in Western terms of victimhood and grievance, they hypothesized that the West would respond with gifts to their attackers.

If your view were true, Arabs would have responded to the breath-taking concessions by Israel in Sinai, Lebanon and Gaza with a decrease in "grievances." Instead, they responded by electing the genocidal Hamas. Overwhelming majorities of Palestinian children are now willing to be suicide bombers. The "extremists" have therefore convinced the overwheliming majority of mainstream Arabs that now is the time to resume the active Jihad.

Israel may lose millions of citizens as the Jihad comes out of hibernation. Please, at least, learn from our fatal mistakes.

#6.1.1.2 Barak (Link) on 2006-03-10 19:12 (Reply)

I got here by a technorati search for UAR. You write (including hyperlink text):

There is news breaking now that the Dubai Ports firm is giving up its attempt to take over US ports by turning it over completely to an American firm: Company Based in UAR Ready to Give Up Attempt to Take Management Stake in U.S. PortsHowever, the details are that "We will continue to hold our U.S. operations separate while this process

UAR? Are you still fighting the Cold War?

#7 John B. Chilton (Link) on 2006-03-10 20:40 (Reply)

Thank you for your comment. Sorry, but the UAR acronym comes from a Cold Warrior headline writer at the Associated Press, not me.

Here's a link: http://www.signonsandiego.com/news/nation/terror/20060309-1055-portssecurity.html

#7.1 Barak (Link) on 2006-03-10 21:44 (Reply)

Barak,

I think you're off base. DPW knows that merely transferring these operations to a US subsidiary would satisfy no one. And if it were just a transfer to a US sub, why would the DPW press release condition the transfer on DPW not suffering economic injury? The press release suggests that PDW will start looking for a US buyer for these operations. Such deals do not happen overnight. Any very large business acquisition requires a lot of investigation and negotiation; there are business and governmental consents to obtain; &c. Enough stuff to keep an army of lawyers and accountants busy for weeks on end. So fear not -- what DPW announced is entirely consistent with a bona fide sale of the US ports operations to a US buyer. It will just necessarily take some time.

#8 ScurvyOaks on 2006-03-13 21:53 (Reply)

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